A new analysis by the National Biodiesel Board (NBB) and the World Agricultural Economic and Environmental Services (WAEES) found that capping the price of conventional biofuels' Renewable Identification Numbers (RINs) will significantly harm the
production of biodiesel and related industries. Although some believe that limiting the price of RINs for the conventional biofuels market won't harm biomass-based diesel volumes, the analysis made it clear that a price cap on conventional ethanol RINs would
result in lower volumes of biomass-based diesel produced and used in the United States.

"Capping the price of conventional ethanol RINs would devastate the biodiesel industry--swiftly and significantly--reducing the amount of volumes produced and people employed. Satisfying the whims of fewer than five refiners isn't worth the resulting harm to
millions of workers in U.S. agriculture and livestock production, as well as American consumers. President Trump can sniff out a good deal from a bogus one, and we are hopeful that he will stick with his campaign promise and reject a cap on RIN prices," said
Kurt Kovarik, NBB's vice president of federal affairs.

The analysis found that capping the price of conventional ethanol RINs would lead to a reduction of up to 300 million gallons in biomass-based diesel volumes each year--in part, because these volumes would no longer be utilized for compliance with the
conventional biofuels requirements; and $185 million more in feed costs for livestock producers.

The analysis utilized WAEES's partial equilibrium model, which can be broken down into crops, livestock and biofuels components encompassing feed grains, food grains, cotton, sugar, oilseeds, ethanol, biodiesel, beef, pork and poultry. Important to
understanding the results of the analysis, the model made conservative assumptions, including an assumption that the biodiesel tax credit would be reinstated. If the credit isn't reinstated, we should expect to see even greater harm and lower volumes produced
domestically.

The analysis showed that soybean producers would receive approximately 16 cents less per bushel in 2020 due to reduced demand for their products. On the flip side, the price of soybean meal--i.e., the protein, not the oil for biodiesel production--will increase
more than $5 per short ton. As a result, livestock producers are expected to pay roughly $185 million more in feed costs due to a cap on RINs. A similar impact can be expected for other oilseed meals, such as canola. These increased costs may negatively
impact consumer food costs.

The Renewable Fuel Standard--a bipartisan policy passed in 2005 and signed into law by President George W. Bush--requires certain volumes of renewable fuels to be used in transportation fuel, heating oil or jet fuel.